Is HCV the new HIV? Health Activists Meet to Develop Strategies to Improve Access to HCV Treatment

Sean FlynnMarch 31, 2009

Another lifesaving treatment is being denied to the world’s
poor through global pricing that provides access only to the nation’s wealthy.
A biologic drug called pegylated interferon can cure Hepatitis C (HCV) in over
half of the patients that take it. But at a global price of over $20,000 a
year, only a small portion of the world’s 150 million people living with HCV
can afford access.

The situation is reminiscent of the late 1990s when
breakthrough triple drug HIV therapies were priced throughout the world at over
$12,000 a year, excluding the majority of the affected population from access.
Will the same strategies that pressed the lowest global price for an effective
AIDS treatment to under $100 a year today be effective at improving access to
affordable HCV treatment? That question lied at the heart of a meeting in Kiev
last week of public health advocates, academics, lawyers, drug manufacturers
and representatives of the Open Society Institute.

This note provides some background information on the problems
being faced in promoting access to HCV treatment. The information is derived
from presentations at the meeting and in the background documents, particularly
from the draft background report circulated to meeting participants by Jeff
Hoover, titled: “Shining a Light on a Hidden Epidemic: Why and How Civil
Society Advocates Can Support the Expansion of Hepatitis C Treatment in Eastern
Europe and Central Asia.”

Following the background information, I provide some
preliminary thoughts on next steps for public health advocates researching
strategies to address IP barriers to HCV treatment access.

HCV Prevalence

Hepatitis is an inflammation of the liver that reduces the
liver’s ability to filter bodily waste and regulate a wide range of essential
biological functions. Hepatitis C (HCV) was identified as a distinct strain in
the 1980s. There are three main genotypes of HCV, of which genotype 1 is the
most common. It accounts for 60 percent of HCV infections, including the
majority in Eastern Europe and Central Asia (EECA). It is also the hardest to
treat.

Symptoms from chronic HCV disease vary widely by patient and
often include fatigue, depression, aches and pains, and forgetfulness. The lack
of clear symptoms makes HCV difficult to diagnose. There are several tests for
HCV, the best of which is a PCR viral load test that is relatively expensive
and lacks robust generic competition in most countries.

In Russia, Georgia and Ukraine, official statistics suggest that
2-5 percent of the general population is affected with HCV. About half of
people living with HIV are co-infected and up to 90 percent of IDUs are
infected. Similar levels of prevalence are reported in India and Thailand.

Globally, there are about 150 million people living with
HCV. There are 3-4 million new infections a year. HCV is the world’s number one
cause of liver disease.

The highest prevalence of HCV in the world is in Egypt,
where it is estimated that up to a fifth of the population is infected.
Widespread transmission in Egypt has been traced to a botched immunization
program that for decades used improperly sterilized needles to infect millions
of people. Importantly, there is now a generic version of peg-interferon in use
in Egypt, as discussed below.

Treatment

The best available treatment for HCV is a combination
therapy including a widely available generic drug, ribavirin, and a widely
patented biologic treatment called pegylated interferon (peg interferon). Use
of the combination therapy including pegylated interferon was approved by the
U.S. FDA in 2001 and has been international best practice for over a decade.

Interferon is a naturally occurring protein that helps boost
the immune system and combat the HCV virus. Treatment of patients with non-pegylated
interferon combined with ribavirin is effective at suppressing, but not curing,
HCV.

Pegylation, which refers to the linking of a peg molecule
(which is similar to a long sugar molecule) to interferon provides two major
benefits. First, it allows more time between injections of interferon, thus
reducing side effects and increasing adherence. More importantly, in about
50-60 percent of patients, peg interferon completely cures the virus, which
non-peg interferon combination therapy cannot achieve.

Side effects from peg interferon combination therapy are
relatively severe. Side effects include fairly common flu-like symptoms
following the weekly injections. More severe depression, anxiety and anemia occur
in about a quarter of patients.

The efficacy of the treatment varies depending on the
genotype of HCV that a person has. The treatment is about 50 percent effective
for Genotype 1 HCV, which is the most common type in many countries. Treatment
is more effective in genotype 2 or 3 patients.

Access barriers

The brand name product, which is the only product available
in many countries of the region, is provided from two multinational companies
-- Roche and Schering-Plough. It is thought that each company has a separate
patent on different versions of the drug that share similar properties.

Hoover explains:

“Generic versions of ribavirin are available, but for years
pegylated interferon has been available only in two brand-name versions:
Pegasys, made by Roche, and Schering-Plough’s PegIntron. The lack of generic
alternatives means that a standard 48-week course of treatment for HCV
infection can cost more than $20,000 even in resource-constrained countries
such as those in Eastern Europe and Central Asia. As a result, most health
systems either cannot or refuse to pay for the highest-quality HCV treatment
for the majority of patients in need.”

There are no global price discrimination policies by the
multinational companies to lower prices for poorer countries or public
programs, as is now widespread for AIDS medications. It appears that every
country in the world is being required to pay essentially the same price for
access to the drug. This pricing strategy is not surprising – monopoly economic
models suggest that the most profitable pricing behavior for a provider of an
essential product will be to price to the global top income earners, which may
justify a set price for the globe regardless of median income levels (see
Flynn, Hollis, Palmedo 2009).

Russia may soon lack any access to peg interferon because of
a recent law banning the importation of medicines into the country. According
to two people at the meeting, about 6 months ago Russia passed a law banning
the marketing of any medicine in Russia that was not locally manufactured. There
is no peg interferon manufactured in Russia.

A representative of a Russian pharmaceutical company
described the new requirements and explained the main treatment response in
Russia is to promote non-peg interferon treatments. As discussed above, non-peg
interferon is a dramatically inferior treatment because it cannot cure the
disease, as peg interferon can in 50 percent of patients.

Patents and competition

Pegylated interferon is widely patented in the region,
including in Russia and Ukraine – the two countries in the region with the
largest populations. The patents cover a combination of two non-patentable
inventions. Neither peg nor interferon is patentable when used alone.

Two presenters at the meeting referred to an understanding
that Chiron holds a patent on the DNA or gene sequencing of HCV that restricts
other companies from creating competing diagnostic tests. It seems unlikely,
however, that there exist such patents widely outside of the U.S.

Generic peg interferon

In the absence of patent barriers to entry, there would
likely be a robust generic market for non-pegylated interferon.

The potential suppliers of peg interferon are quite
numerous. A medical researcher at the meeting reported that once a firm has the
capacity to make interferon itself, attaching the peg is a relatively simple
step that any supplier of non-peg interferon could master. It is estimated that
there are at least 20 companies around the world making high quality non-peg
interferon presently.

There is a generic version of peg interferon currently available
from Egyptian manufacturer Minapharm. The drug, known as “Relferon,” has been
in use in Egypt since 2006 and is currently sold at about 25 percent of the
branded price (approximately $4,000 /year). The patent and licensing status of
Relferon is unclear. There have been suggestions that the product may be
produced under a patent or know how license from Schering Plough. Hoover’s
paper reports being told in an interview that a German firm extended a license
(presumably a know how license) to it. Minapharm has not responded to inquiries
and this information is largely conjecture.

There are reportedly several Chinese companies that
currently make peg interferon. There have been unconfirmed rumors of quality
problems with these products.

Peg Interferon is patented in India. It is unkown the extent
to which it is patented in other possible producing countries such as Thailand,
India and South Africa.

Indian pharmaceutical firm Wockhardt challenged a patent
granted to Roche in India for Pegasys. That challenge, filed in 2007, was later
joined by Indian NGO Sankalp, which works with intravenous drug users and was
represented by the Lawyer’s Collective. The briefing in the post-grant
challenges has been completed and the parties are now awaiting a decision. A
key argument in the cases is that peg interferon is a combination of two known
substances – peg and interferon – neither of which is itself patentable.

There are other Indian biotech firms, including Shantha
Biotech and Bharath Biotech, thought to be interested in peg interferon
production should the patent barrier in India be eased.

Downstream innovations

There are companies developing new methods of altering
interferon to achieve pegylation in ways that do not violate the Schering and
Roche patents and therefore may not need compulsory licenses to supply the
world market.

In the U.S., Human Genome Sciences and Novartis are
developing “Albuferon.” The treatment will presumably be patented and targeted
at wealthy countries.

Poly Therics invented (and has patented in four countries) a
new pegylated interferon placing a peg in a different part of the interferon
molecule. The inventors have licensed Shantha Biotech in India to take the
medicine through the final clinical trials and produce and market the product.
The drug will go into clinical trials in India in end of 2009. French biotech
firm Biomerieux has bought Shantha and is continuing development of the drug. The
goal of the firm is to focus initial product marketing in the developing world
for approximately $2,000 per course of treatment.

Competition problems in supply of peg raw material

There may be immediate supply problems with obtaining
pharmaceutical quality peg to link to interferon. High quality peg is
relatively difficult to produce, contrasted with the process of linking the peg
to interferon which is reportedly relatively simple.

There is one main supply of peg currently – Nektar in Japan
– which supplies Roche and Schering Plough. Nektar has reportedly been very
unresponsive to requests to purchase small amounts of peg for developing
competing products.

There is one known alternative supplier of peg. Biovectra of
Canada was established at a university with government support and now provides
peg to Shantha.

Pipeline for new HCV treatments

There are other drugs in R&D pipelines that are
attempting to improve the efficacy of the peg interferon treatment by adding a
third drug to the treatment cocktail. Any of these drugs appear to be at least
two years away from marketing.

Thoughts on the way forward

It appears from the information shared at the meeting that a
compulsory licensing or other strategy to bring down patent barriers to the
marketing of generic forms of pegylated interferon could be effective at
improving access to affordable treatment for HCV. The current global price for
pegylated interferon is incredibly high – reminiscent of AIDS drugs in the
1990s before campaigns to shame companies and support generic production began.
If there were no patent or registration barriers to marketing generic peg
interferon, it seems likely that a large number of generic producers (e.g.
those currently making non-peg interferon) would compete in supply markets and
force prices down to much more affordable levels. Immediate savings of 75-80%
appear likely. Longer term, prices may be pushed much lower.

Patent pools may help promote further downstream innovation,
particularly for firms that are seeking to develop new versions of HCV
combination therapy that add a third drug to the existing two-drug treatment.

There should be further investigation into the patent and
licensing status of Relferon in Egypt. If the product is being produced under
license from Schering Plough, could parallel importation be used to access the
drug in other countries i.e. does the license exhaust Schering’s rights in
countries with international exhaustion rules?)? Is the drug one of high
quality? Are their licensing or other conditions that would prevent export of
the drug to other countries? If so, could those provisions be challenged under
patent, completion or human rights law provisions?

India is likely to be a key site of advocacy. If the current
challenge to peg interferon patents fail, research into other licensing
strategies will become necessary. Given the likely need to establish export
capacities in India, these strategies will likely need to include either use of
competition grounds for licenses (thus allowing unlimited exports under TRIPS
article 31(k)) or utilization of India’s “paragraph 6” implementing language.

More research should be conducted on best practices for biologic
product registration for implementation in developing countries. Biologic drugs
are a new technology, and most countries lack a specifically defined avenue for
registering generic versions of biologic treatments. The U.S. is currently
developing legislation to open a registration pathway for generic drugs and the
EU has had such a regulatory pathway for several years. The issue is unlikely
to be addressed in developing country legislation, however. Research should be
conducted on best practices for altering or interpreting registration
procedures in developing countries to permit registration of quality generic
biologic drugs.

On June 3, PIJIP and OSI will convene an expert meeting of
IP specialists in Kiev to further discuss possible licensing and other
solutions to the IP barriers to HCV treatment.

In September 2009, PIJIP and OSI plan to organize a training
on intellectual property and access to medicines for health activists in the
EECA.